Irish telcos accuse Eir of ‘tactical interference’ in broadband project

Eir has rejected suggestions that its mooted €1 billion plan to deliver the objectives of the National Broadband Plan (NBP) was a form of “tactical interference” in a public procurement process.

The charge was made in a letter sent by Alto, an umbrella group of Irish telecommunications companies, which also suggested that Eir could be legally challenged if the NBP were derailed by its actions.

In a statement, Eir said that it had volunteered the figure of €1 billion when asked to supply information to the Oireachtas communications committee last month. "Eir was invited by an Oireachtas committee to make comment on the NBP and the topic of value for money and having expertise in the matter responded to that request."

The company emphasised that its submission was information sharing, rather than a formal offer. "We are surprised that Alto, a group that claims to promote fairness and openness, would be against further transparency," it said. The company also disputed an assertion made by Alto, whose members include BT, Verizon and Sky Ireland, that it had secured 85 per cent of customer contracts in an area which Eir has hived off from the original portfolio of intended NBP premises.

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Alto had suggested that the 85 per cent figure was “evidence of a market failure by any objective competition analysis or assessment”. Responding to that figure, an Eir spokesman said that “Alto’s guess at Eir’s retail market share is inaccurate and misleading”, adding that its market share was equivalent to that which it holds in other rural and suburban areas.

According to the Alto letter, Eir's suggestion that it could complete the broadband plan for €1 billion represented interference in a public procurement process, and it told Mr Bruton "if (it) is seen to have borne fruit then Alto consider it will be appropriate to bring such a matter to the attention of the European Commission Directorates General Competition and Information Society for further investigation."

It accuses Eir of risking an “untold” impact to the NBP through its recent claims, which were made first two weeks ago at a meeting of the Oireachtas communications committee.

Consumer choice

It says it is “critical” the other telecommunications providers are able to “support an NBP process where consumer choice and equal treatment are at the forefront of the planned intervention”.

“Alto has very significant concerns about Eir’s intervention and apparent attempt to reopen the public procurement process having previously withdrawn,” it says.

“The behaviour of a dominant player such as Eir, tacitly interfering in a social policy measure that is pro-consumer and pro-competition and recognises the need to protect the State (and taxpayers’) investment could have untold reputational and distortionary market impacts if the Government decides to either pause or scrap the NBP intervention as a consequence.”

It also described Eir’s intervention as “entirely hypothetical” and suggested other companies could make similar statements based on “entirely hypothetical models”.

The NBP aims to deliver high-speed broadband to up to 520,000 rural premises in a project that will cost up to €5 billion, with an anticipated €3 billion coming from the exchequer in the form of a subsidy.